Estonia's new govt

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Floreat Estonia

Apr 5th 2007
From Economist.com

The least bad government in eastern Europe

ESTONIA'S new government may well be the least bad in eastern Europe. But that’s a modest claim. The serious competition is at the other end of the scale, where Poland currently has the edge for incompetence, the Czech Republic for feebleness and Romania for fractiousness. It’s a pretty bleak picture, the more so with Russia flexing its muscles next door.

By the standards of the neighbourhood even the outgoing Estonian government was adequate. It was stable and reasonably efficient thanks to the canniness of the prime minister, Andrus Ansip. The economy rocketed ahead.

But stability came at the cost of progress. Estonia’s famed innovative edge was blunted. Corruption started creeping up, especially in some ministries and municipalities controlled by his coalition partners. On vital issues such as education and e-government, reform largely stalled.

Mr Ansip’s new coalition should be a boost, not a brake. The main partner is a conservative grouping led by Mart Laar, a visionary former prime minister. Another partner is the social-democratic party to which Toomas Hendrik Ilves, the country’s formidable president, used to belong.

Talks to form the coalition, following an election last month, proved surprisingly difficult. Mr Ansip ruled out the appointment of Mr Laar as foreign minister, calling him too strong-willed. The truth is that Mr Ansip was jealous.

Mr Laar belongs high in Europe's pantheon of post-communist heroes, alongside Poland’s Leszek Balcerowicz. His shock therapy in 1992 gave Estonia free trade, sound money, privatisation and flat taxes, all in less than two years.

Mr Ansip is a likeable fellow with a pleasantly sardonic turn of phrase. He was a decent mayor of Tartu and he is still an impressive athlete. But he is no Mart Laar.

EPA

Mr Ansip: no to Swedish models

Sweden’s inexperienced prime minister, Fredrik Reinfeldt, handled a similar challenge more gutsily. He too had the option of appointing a vastly better-known predecessor, Carl Bildt, as his foreign minister—and he did so. That was good for Sweden, and it made Mr Reinfeldt look big. Mr Ansip stands diminished. Still, Mr Laar remains in parliament and as party leader. His time—in Tallinn, or perhaps in Brussels—will come again.

The new coalition, alone in eastern Europe, has a parliamentary majority, clean and effective ministers, and a largely sensible programme. Mr Ansip has no excuse now: he should aim to have the best government not merely in eastern Europe, but on the whole continent.

He faces some big tests. One is to clean up the mess left in the ministries (notably interior and environment) run by the outgoing coalition partners. Tallinn’s municipal finances and management need a stable-clean. Letting Estonia’s boom cool safely will be tricky too, especially if promised tax cuts make the red-hot economy even hotter.

The government’s most immediate challenge, though, will be defusing a pre-election row that Mr Ansip started over a Soviet-era war memorial in Tallinn. Supposedly, the monument has to be moved because it serves as focus for pro-Russian demonstrations against Estonia and because it inflames hardline Estonian nationalists.

Predictably, Russia portrays the planned move as pure vindictiveness, a sign of resurgent Nazi sympathies and of ingratitude towards Soviet sacrifices. Bungled diplomacy has left Estonia’s allies surprised, baffled—and silent.

The plan is not to tear down the memorial, but to move it, and any bodies on the site, to the more suitable surroundings of a war cemetery. Portrayed like that, it may be more palatable. But it will still be a hard sell: just the sort of challenge Mr Laar would have relished, given the chance.